Volkswagen's Twin Fronts: A Sharper Profit Warning Meets a Leadership Shake-Up in the US
Published on 08/10/2026 at 18:32 | Redaktion boerse-global.de
The pressure building on Volkswagen's management has now crystallized on two fronts simultaneously. While the Wolfsburg-based automaker's finance team was busy walking back its revenue guidance for the year, its human resources department was quietly orchestrating a change at the top of the North American operation — a sign that the group's troubles are not confined to any single market.
The most immediate headache is financial. Having previously guided for sales growth of 0 to 3 percent, the board now expects revenue to land anywhere between minus 3 percent and flat. The revision, announced alongside second-quarter figures on July 24, reflects a period that went badly off script. Net profit after tax tumbled 32.9 percent year-on-year to €1.54 billion, down from €2.29 billion in the same stretch of 2024, even though operating profit of €3.5 billion edged ahead of the prior-year level.
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The US Reset Takes Shape
It is against that backdrop that Volkswagen has decided to change the guard in America. Marco Schubert, currently head of sales at the premium Audi brand, will take over the US business, replacing Kjell Gruner, who is departing the company. The handover, first reported by Handelsblatt and confirmed by a company source to Reuters, lands at a delicate moment for the Chattanooga, Tennessee, plant. Production of the electric ID.4 was halted there earlier this year after changes to US federal incentives for battery-powered vehicles undermined the model's economics.
The US operation is also getting a product refresh. A new pickup truck is in the works, though whether it will be developed solo or in partnership with a company such as Ford has yet to be decided, with a call expected in the coming weeks or months. In the meantime, Volkswagen used the same day to unveil the new Atlas Cross Sport in Chattanooga — a signal that the factory, despite the EV setback, remains central to the group's American ambitions.
A Deeper Cost-Cutting Drive
The US reshuffle is just one strand of a broader restructuring that is beginning to take shape. On July 9, the board presented a twelve-point package, dubbed "Zielbild 2030," to the supervisory board. The plan is sweeping in scope: a reduction of the model lineup by up to 50 percent, a cut of up to 75 percent in available equipment options, and a target operating margin of 8 to 10 percent. Roughly 50,000 jobs are slated to go by 2030, with annual savings of more than €6 billion expected. Decisions on potential plant closures and further job cuts, however, have been deferred until after the summer break.
The cost imperative was underscored by a profit warning from Audi, which on July 27 slashed its 2026 outlook, now expecting around €5 billion less in revenue and thinner margins. The premium brand cited constrained business in both China and the US and promised a stepped-up efficiency program of its own.
China Remains the Structural Drag
The numbers out of China continue to make uncomfortable reading. Deliveries in the group's most important single market fell 26 percent in the second quarter to 424,300 vehicles. That weakness, alongside the €0.5 billion hit from winding down ID.4 production in the US, weighed heavily on the quarter's results.
Analysts have responded by trimming their price targets, though notably without abandoning their bullish stance. Deutsche Bank Research cut its target from €120 to €115 on July 27, keeping a "Buy" rating. Jefferies made an identical adjustment on the same day, also retaining "Buy." Berenberg went further, slashing its target from €113 to €100, with analyst Romain Gourvil pointing to solid free cash flow but persistent challenges in China. Another bank had previously lowered its target from €99 to €90, again while maintaining a buy recommendation.
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Market Reaction and the Road Ahead
The preferred shares have been caught in the downdraft. At the latest reading, the stock stood at €75.54, down 0.84 percent on the day, following a Friday close of €76.18 that had itself marked a 1.20 percent gain. The longer-term picture is uglier: the shares are down 27.47 percent since the start of the year and sit 30.76 percent below their 52-week high of €109.10, reached in December. They also trade 17.23 percent below their 200-day moving average. Market capitalization has shrunk to €36.00 billion.
There have been personnel moves elsewhere in the group too. Joost Kessels took over as Chief Development Officer for SEAT and CUPRA on August 1, tasked with strengthening both brands' roles in the electrification strategy. And in a separate portfolio decision, Volkswagen agreed in late June to sell 51 percent of Everllence to Bain Capital for around €7.4 billion, retaining a 49 percent stake. Protection clauses for the German sites in Augsburg, Oberhausen, Berlin, Hamburg and Ravensburg run through the end of 2030, ruling out operational redundancies in that period.
Investors will get their next read on progress when third-quarter numbers are due on October 29 — an early test of whether the US overhaul and the cost program are beginning to move the needle.
